Value Invest London

March 2013

James Montier and Jeremy Hosking join the speaker line up at the London Value Investor Conference
Joining the already impressive line up of Howard Marks, Anthony Bolton, Michael Price and David Harding (and Simon!) are GMO’s James Montier, author of several books including the excellent “The Little Book of Behavioural Investing” and Jeremy Hosking, an Entrepreneur and Fund Manager with 34 years of experience in the industry.   If you are interested in joining us, there are a few tickets left.

Even a Subpar Sage is Pure Genius
John Kay discusses how Berkshire Hathaway owes its stellar success to a model that is sustainable and simple, so it is baffling that there are so few imitators.

The March of the Algorithm Merchants
This interesting article in the FT by Jonathan Davis looks at the rise of systematic trading in the fund management industry and contrasts this with Warren Buffett’s investment performance. The writer suggests that had the same tools we have today been around 30 years ago, Mr Buffett’s performance could have been replicated by a computer. Whilst the concept is interesting and trading using both simple and increasingly complex algorithms certainly has a future in the fund management industry, many will doubt whether a computer can replicate the judgement needed to make a great investment. As Albert Einstein once said “Not everything that can be counted counts, and not everything that counts can be counted.”

Ben Graham Video
A rare glimpse of the great teacher in action followed by a series of anecdotes from some of his students, including Warren Buffett and Charles Brandes.

Warren Buffett Video
In this CNBC video on 4th March Warren Buffett discusses the Heinz deal, the propensity for Berkshire stock to underperform the S&P in a rising market and how he would repurchase Berkshire shares up to 120% of book value.

Austria’s 97 Years of Loss
This article by John Authers stresses how difficult it is to time the market because the mean (to which the argument goes that everything will revert) itself inflates, rendering the data at the time of the bubble much more confusing that in hindsight. The article trawls through scientific attempts at building market timing models based on price to dividend multiples; these models under performed. John Authers concludes “buying into funds that keep costs low by following disciplined quantitative strategies to invest in value, high dividend, or small-cap stocks, or to harness the momentum effect, looks like a great idea”. [Footnote, there is no doubt that momentum strategies work, but we have not found a way to use them alongside value – David Harding’s talk at the London Value Investor Conference may shed some light on this area].

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  • “It’s very much the Rolls-Royce of the investor conference market”
    Paul Scott, Stockopedia
  • “The people in that room were a more powerful cadre of the powerhouse of investment than has been gathered for a very long time”
    Jonathan Ruffer, Ruffer LLP
  • “It’s kind of like Glastonbury isn’t it, for the Value Investing community”
    Nick Train, Lindsell Train
  • “What I like about it is that it is a practitioners conference and it’s an opportunity to come and hear from your peers about the work that they are doing and how they see value investing”
    Hassan Elmasry, Independent Franchise Partners
  • “I think people really look forward to it and enjoy it. There’s a good bunch of people here who have travelled a reasonable way – the speaker after me was from Hong Kong and there’s a big Canadian crew and a big US crew – people come from around the world to see this”
    Nate Dalton, Affiliated Managers Group
  • “If somebody’s already been through that process of seeing what the conference is about and then is willing to pay their money for the effort of coming here, that’s a great filtering process.”
    Gary Channon, Phoenix Asset Management
  • “The conference has become a part of the furniture of the London scene. You can discover that is what lies inside you – that you are innately a value investor.”
    Richard Oldfield, Oldfield Partners
  • “I do speak at a fair number of conferences to investor bases, this one is really quite a good list – some very, very good investors present and some very interesting speakers”
    Jon Moulton, Better Capital
  • “Definitely worth it and I know a number of people who have ‘ummed and arred’ about coming along and I’m sure that they will be regretting that they didn’t come today – and it’s only going to get better as far as I can see”
    Tim Green, Private Investor
  • “Having sat through the whole day as I wanted to come and hear all of the speakers – I’ve been really impressed by the quality”
    Anthony Bolton, Fidelity
  • “I’ve got a bunch of business cards to add to my collection and some folks I’ve been looking forward to meeting, plus some firms I didn’t even know existed but sound really interesting and I’m looking forward to building on that relationship base”
    Mason Morfit, ValueAct Capital
  • “You couldn’t find that anywhere else really, where you’re speaking to the principals who have been voted on to the Board [of Microsoft] to effect change”
    David Shapiro, Willis Towers Watson
  • “What I was impressed with is, because the subject is very similar, value investing, they found a variety of ways of attacking the same subject. I was also very impressed, having done this in another location, of seeing them stay on target time-wise so that it moves along at a great pace and I think the audience is greatly rewarded by that discipline”
    Don Yacktman, Yacktman Asset Management
  • “Very well organised and it was a treat for investors like us to hear some great speakers”
    Roli Saxena, Drona Capital
  • “I came last year and I liked it so much that I have been looking forward to today ever since”
    Dominique Levy, Sonian Capital
  • “We’e got a very sophisticated audience who are used to value investing – I think this is a good audience”
    David Samra, Artisan Partners
  • “The profile of the speakers is one of the main reasons that I came”
    Niels Borgen, Private Investor
  • “When you look at the ideas speakers have put forward in previous years and how they have performed over the last few years, they’ve done very well – if that performance continues it would be quite remarkable. It does show that you can pick up some good ideas at a conference of this sort”
    Jonathan Mills, Metropolis Capital
  • “I came last year as well and I thought that it was the most outstanding event that I have been to”
    Leon Boros, Equity Strategies